Economist Says 'Red and White' Village Cooperatives Align with Founding-Fathers' Ideas

Economist Dr. Surya Vandiantara stated that the Kopdes Merah Putih (Red and White Village Cooperatives) programme is conceptually aligned with the ideas of Indonesia’s founding fathers. Article 33 of the 1945 Constitution stipulates that the Indonesian economy is structured as a joint effort based on the principle of kinship. One implementation of this article is the cooperative, through which economic development can be pursued without discriminating against class or social groups. “The main idea behind the establishment of cooperatives by our founding fathers was to advance the economy through mutual cooperation without discriminating against any class or group in society,” Surya said in a statement on Sunday, 12 July 2026. According to Surya, one of the main characteristics of a cooperative is mutual cooperation. The community pools funds as collective capital, which can then be used to help fellow members through savings and loans. The profit from these member loans is ultimately returned to the cooperative members to be enjoyed together in the form of SHU (Sisa Hasil Usaha). “This principle of mutual cooperation, in the savings and loan cooperative scheme, is implemented through members’ principal savings and mandatory savings, where this money can later provide assistance or relief in the form of loans to other cooperative members for both productive and consumptive activities,” he explained. Through the Kopdes Merah Putih programme, Surya said the government is essentially trying to push this cooperative concept down to the grassroots level. State intervention is carried out by substituting the cooperative’s capital source from member contributions to tax revenue, but the principle of mutual cooperation remains. “Unlike savings and loan cooperatives that rely on collecting funds from members’ principal and mandatory savings, the management of Kopdes Merah Putih relies on tax revenue collected from the public to help other members of society. Thus, the principle of mutual cooperation, which is the main principle of cooperatives, remains the primary foundation,” he clarified. This intervention, according to Surya, can bridge the classic problem of cooperatives, where people are reluctant to join due to the inability to pay principal and mandatory savings. Despite this, the benefits can be felt by the wider community. “This Kopdes Merah Putih innovation is also capable of answering the classic problem of previous cooperatives, which struggled to invite people to become members due to the inability to pay principal and mandatory savings,” he explained.